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tv   Countdown to the Closing Bell  FOX Business  December 10, 2012 3:00pm-4:00pm EST

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♪ liz: good afternoon, everybody. i am liz claman. it is the last hour of trading. it is "countdown to the closing bell." we do have pretty much green on the screen. at least for the dow jones industrials. taking a look at the dow, it is a hodgepodge of green and red arrows. we do have pockets of strength in the older tech names. hewlett-packard continuing its winning streak. then we also have karl icahn rumors begin the round. set to be building up his position and hp. microsoft is up about 1.5%. you could call it an over technology stock. it did not look good early for the stock markets. the ability or lack there of in
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europe. mario monti is stepping down as prime minister of italy. he lost support of the people. he was out in front of italy's debt crisis last year and he lowered the bar in cost. he is a smart guy. he obviously does not want to stay there. investors took heart from the latest data out of china. growth is accelerating. no more that owning our process here. almost 10%. beating analyst estimates. copper moved higher. it is an industrial metal. money flowing into stocks. minors like numa mining. then, of course, the announcement that they would be taking a big acquisition. today, it is up more than a percent. cliff natural of about 5%. we should not forget mcdonald's.
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better same-store sales than expected. coming up in just a few minutes. cash is king at ethan allen peered the furniture retailer throwing a lot more cash at shareholders. they are announcing a one-time payout this month alone. we will get the inside story from ethan allen chairman and ceo farooq kathwari. you have to hear about his plans for china. international expansion is a huge priority. the chinese may like that product. for once, the market riding around. let's get right to the floor show. traders at the new york stock exchange, cme and imax.
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what do you think happens on wednesday? >> i think most traders and the entire street is interested in seeing how they will handle operation twist. that really seems to be the case. i am of the mindset they will have a very difficult time explaining any extension. granted, it is not where they wanted to be but it is an indication that the economy is improving. liz: qe4 is coming. is that going to be another announcement? >> c evans came out a few weeks ago suggesting that they continue to use the 85 billion number.
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i do not know if they can justify that quite frankly when you have the economic data that we continue to see. you mentioned china coming in, the increase in electric production which is a great sign meaning that the economy is picking up. there was a big fear that mcdonald's and the american consumer would step away. i have a hard time believing that the said will be able to go on their way and actually put something in place that will say we need to continue this. liz: mcdonald's is proving the naysayers wrong. all three parts of their business looking very healthy. it is not exactly dependable when it comes to any company. we are looking at a market that is in the narrowest trading sent
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october. >> take a look at some of these stocks. let's start with lockheed martin. you have a defense that you have a bleeding defense sector stock. that will obviously be impacted greatly depending on what happens. if you look at lockheed martin over the last six-eight weeks, it really has held its own. it is trading in a fairly narrow range. it is trending near its all-time high. maybe a barometer of what they happen to some of these stocks depending on the fiscal cliff. maybe things will not be so bad. on the other hand, now you have a stock in a completely separate sector. locate gap stores. all of a sudden end of last
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week, we saw this huge drop. the stock down about 15%. liz: what is it about gap at this point? >> >> it has been on such a great rally. i think there is some sentiment that because they did not announce any sort of forward diviiend that some of the investors are disappointed. with this thursday coming out with november retail sales data, people are thinking it is maybe not so good much like people are saying at apple that people are taking money off the table, that may be the same story with gap. liz: one story that may very relate is john woods the fact that gasoline went flat today
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has come down. down $0.10 over the past three weeks does this trend continue where is the next trade you cannot have high oil prices and expect people to pay high oil prices at the pump. in economy will just come right to a halt. i can see crude coming down to $82 really just hanging there. this is where we are going. the economy will dictate, essentially, the price of oil right now. liz: okay. gentlemen, great to see you. thank you so much for joining us on the floor show. at least though both are winning. apple. it has been the headline almost every single day for the past six months.
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we have heard of too big to fail. are some companies just too big to succeed? my next guest says once a company gets to the top, there is nowhere to go but down. what does that mean for all of you apple watchers. joining me now is robert arnott. it is great to have you. so glad you are here to discuss this. i can hear people screaming right now. what do you mean. apple has to go higher. what is your premise here? >> firstly, a lot of credit goes to my co-author on this study. she did all the heavy lifting on this. historically and ask a very simple question. when a company gets to be the
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largest in its sector, the largest in his country or the largest in its world and that is something we have always known. a great company is not always a great investment. what we find is no top dog has ever stayed top dog and, if you have a top dog, it winds up being targeted by regulators, targeted by pundits, targeted by competitors. they cannot compete as aggressively. liz: what we have on the screen is really important here. it shows your study. let's just say, for example, three years after a company like apple hits the top market cap, and the names relative to its sector if off about 4.5%. ten years later it is down about
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3.7%. really ugly. down 11%. let me jump in and say, what about exxon mobil, for example. since looking at the charts as 1875, it is a pretty decent move to the upside over 75 years. that was a company that remained there for quite some time. >> that is exactly right. exxon mobil is the exception that proves the rule. it is the only sector top dog in the world that has stayed in sector topped out for 50 years. that does not mean it has outperformed its sector. it has just kept pace with its sector, despite being top dog. had how do you identify the next
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name? >> i think people need to recognize that great companies are not necessarily good stocks. you do not get rewarded for chasing popularity you get rewarded for buying discomfort. what is a huge company that is out of favor, unloved and, yet, still huge? bank of america. it trades at one fifth of the value of apple. you get ten to 20 times as much in sales or profits and book value. that does not mean it is a great company. it means that the share price already reflects that it is a struggling company. it reflects the fact that apple is a golden success story.
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it has to remain a golden success story for the coming ten to 20 years. liz: you are so welcome to show people the trends over the years. i am glad we identified exxon mobil. thank you. it is great to have you on the program. ethan allen. a big name out there. has all the comforts of home. it is everything. the retailer is riding the wave of a housing recovery. on top of that, it is dishing out money to shareholders before the end of the year. farooq kathwari on what he fast dividend. his 70 plus stores in china and how good he thinks the holiday shopping season may be. that is next in a fox business exclusive. ♪ can i help you?
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i heard you guys can ship ground for less than the ups store. that's righ i've learned the only way to get a holiday deal is to camp out. you ow we've been open all night. is this a trick to get my spot? [ le announcer ] break from the holiday stress. save on ground shipping at fedex office. liz: now for a look of the big
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movers with nicole petallides.
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we also have jeff flock. unbelievable because every one of my kids class are dying to get these things. they have a motorcycle version, sparkle glitter version. the sales are not what they're cracked up to be. nicole: the ssquence version. uggs are incredibly popular, but a lot of other boots and brands on the market plus that coupled with the competition and the fact you don't have a big heavy winter as some had hoped especially those who own deckers. last week there was mergers and acquisitions chatter whether or not one of the companies would step in and be looking at deckers. today is a different story. they're getting ready to mark down the booos, the popular ugg% boots from children to grown-up adults, that is not good news.
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they start marching down key items ahead of the holidays already, that will not be good. down 7.5%. liz: i heard there was snow in deer valley. what are you looking at? >> no snow in chicago fortunately. the two big movers. copper and coffee. copper moving up about 8% on industrial production in china come the output is positive with the highest close in eight weeks. coffee down about 5% today. because there are more beans than they know what to do with in brazil. the one that starbucks and dunkin' donuts and everybody makes good coffee bytes. they have a low year harvest every other year and lower harvest but this year it is a booming harvest driving coffee prices down. we always look at gold just for fun, the gold rush is done.
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nobody is excited about gold anymore. liz: peter schiff says the coins themselves, wait until you hear what he has to say about that. the fiscal cliff, that is what all investors seem to be hearing. partly because of the media. take ethan allen for example. retail expanding overseas keeping most production here in the usa and an added kicker, recently announced a special one-time dividend. it is related to the fiscal cliff, but chairman and ceo. $0.41 special dividend payable december 20 and $0.09 dividend in january payable december 20. he fast tracked it all. why? >> it is for stockholders.
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we have to make sure we take care of all the stockholders. increased our retirement 401(k) payment retirement for our employees by 20%. this makes sense. liz: is a directly related to the tax break on dividends? >> absolutely. we're fortunate we are in a position to do it. $100 million in cash. the relatively smaller amount. $12 million i think it makes good sense for us and also good sense for the dollar, going to get texas. it is an interesting situation. good for stockholders and also good for the public. liz: the calendar shoveling to help the shareholders like to say people look magnificent, you are about 98% stakeholder, so your tax bill is a huge savings as well.
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because he will save $400 million because of this. that articulates how people are being affected, but in the end how important is it to strike a deal? do you feel everything going to be mayhem if we don't? >> i really don't know that. other ceos, with a meeting with a number of ceos and i asked are you preparing for the fiscal cliff? and almost there was a blank. nobody is really thinking that will take place, and if it does we have to manage our business. liz: how are you preparing besides the dividend move? >> i will give a special edition. the reason i am ssying is this, to survive for 80 years and have two reinvent either by accident or by plan so he constantly reinvent.
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constantly making changes almost on a moments notice. if we have to, we will do what is needed. liz: speaking of reinvention, the chinese were kicking ethan allen down about a decade ago making cheaper imports. now you have turned the table on them, 77 by the end of the year stars in china. you are making the furniture, selling it to the chinese, what's next? what is your next step? >> we have to reinvent every element of our business. see what we do today, and effects ring is not easy. we are doing what i call making products that are relevvnt, we have custom manufacturing and delivering it.
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that is what we are doing. take a look at some changes we have done in the last three years, we have changed our product lines, reposition the manufacturing. liz: how they expect holiday sales to be? >> we are not in the business of gifts. holiday sales are not necessarily the most important part of the business. every month is important. consumer confidence is better. there are uncertainties, but housing terms have improved, prices have gone up so i think we're going in the right direction and i think washington has to fix this. liz: the stock is going in the right direction. 22% since the last time you were
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here in september. thank you so much. happy holidays. ethan allen chairman and ceo and president and of course the dow jones industrials fourth session in a row with 27 minutes to go. can we hold onto these games? so much to come.
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liz: in the lexicon today, usually means no big deal, but today redefining it to mean the next big deal from washington, d.c., to wall stre wall street. bartering so they can come out on top. let's shake it up on the team. peter, to you first. >> not the fiscal cliff. not today. just a day at a meeting speaker john boehner at the white house, president obama extended a
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little olive branch in avoiding the fiscal cliff. >> i have said i will work with republicans on a plan for economic growth, job creation and reducing our deficits. and had some common western democrats and republicans, i understand people have a lot of different views, i'm willing to compromise a little bit. >> the white house would not disclose any details of the meeting with the president and the speaker yesterday. both sides confirming communications are open. speaker john boehner saying discussions are taking place. liz: maybe the fact they're keeping quiet may mean something is really going to happen. keep dreaming. >> does politics have to watch out what is happening in silicon valley. apple and google compete on so many different rounds. but they're actually coming
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together to co-compete on a bid for the patents that kodak holds. 1100 patents, half a billion dollars. they realize instead of sitting across from each other playing and outbidding one another, we will work together and co-compete for these and work together to get these patents for both of us. something to watch. liz: not all patents are equal. they will start dealing and wheeling. >> it all looks kosher right now, but i'm sure it is not. liz: what about the flash cube patent. dennis, what about you? >> mayor bloomberg could be in for holiday shopping. bloomberg media company may want to buy the financial times. any deal more for prestige and profits.
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preservation down 30% in four years, 300,000. yet bloomberg is a hungry acquirer. a deal here would give bloomberg 50% ownership of the economy. it could go for a price of $1.6 billion. valuing them at double the price of u.s. print properties on a per point. whether ceo plays on march in the print business. rival to bloomberg and pearson said to be a possible bidder. our boss, rupert murdoch might did. @e is busy spinning off the "wall street journal." liz: the terminal sales, for those who don't know, the terminals they ar that are cove, great moneymaker. those sales are not what they used to be.
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>> more and more data available on the internet. they are buying up properties and buying up talent like crazy. like an old tarzan film. liz: all of us liked it, we don't have to look and find where the articles continue3 because they don't. >> brevity is key. liz: thank you very much. the closing bell ringing in 29 minutes. good to guess the biggest hit in risk the world economy and financial markets, what would you choose? this matters so much to your monies we thought we would bring in nobel prize winner who won for spotting exactly that type of stuff. he won the nobel prize in economics and he says three potentially scaldinggissues are boiling underneath the surface. that could burn investors at a time they least expect it, expect it.
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be ready for it, helping next to fox business exclusive. [ roasting firewood ]
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impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u.s.? at t. rowe price, we understand the connections of a colex, gbal economy. it's just one reason over 75% of our mutuafunds beat their 10-year lipper average. t. ro price. invest with condence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. >> i'm adam shapiro is your fox business brave. stocks continue to drift between gains and losses. investors continue to focus their attention on washington and the fiscal cliff negotiations. right now the dow was up 34 points. the justice department antitrust division is a record amount of criminal fines this year handing out more than $1.1 billion in penalties. the doj confirmed the ddta provided exclusively to
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fox business. the jerseys can industry suffered the biggest drop thanks to superstar sandy. atlantic city's casino revenue slipped nearly 28%. each of the city's 12 casinos reported declines with for down for a month. we continue our "countdown to the closing bell" with liz claman. liz: the fiscal cliff talk is everywhere, always good to be hearing about lately, but is there really something else that can be bubbling under the surface that could send the market into a tailspin that we should be talking about now? join me in a fox business exclusive, 2003 nobel laureate in economics and nyse will institute director. he has a whole institute for
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volatility. spotting risk. we thought let's bring you in and talk about noo the fiscal cliff of the three hidden risks people should be talking about but aren't. how did you identify them? >> there are lots of things people worry about, but which of the really big ones and what kind of a timefram time frame ae talking about? decade?out next week or next we talk about the big risk to have to look further in the future. liz: the next year or so? 20 years, 50 years perhaps. number three. you say it's all the unfunded pension liability risk globally, how is that a hidden risks? >> there are pension funds like social security which are not well funded in the future, that is one of the big topics of the
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fiscal cliff, but also pension funds o for state and local governments. pension fundsfrom european governments, pension funds over the world. if they collapse, the government will be obliged either to fund them or to break the bad news the electorate that they are not going to. liz: it exaggerated worldwide? >> it is a big problem. lots of pension funds are investments in those don't pay anything anymore. liz: government don't have my two bailout. her next one is, this stumped me. climate change. >> i think this is bubbling
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under the surface. we worry about it when we are not dealing with more shortbread issues. i think it has to come to the top of the agenda because we are changing our environment. liz: look at hurricane sandy with his bizarre storm surge, a snowstorm here in october and nothing all winter. how does that affect my portfolio? >> i think if you look carefully, we can see firms you think might do well in a world which has more climate distress. and firms that won't. firms, they actually look like they are overpriced. it was expensive. that means people are actually investing in these kinds of industries and that means
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investing population is worried about it. liz: look at vail resorts but they hit because there is no snow and skiing companies. we cannot roll the something that we don't know, but it is a concern. let's get the number one. something we were talking a lot about and stopped because the fiscal cliff insanity. that is. >> europe. europe has the potential to unravel this is not a decade-long agenda, this is actually within a year maybe, i don't know. it has the possibility of breaking apart, having a severe recession that will impact the u.s. economy and that made all this momentum that we are hopefully starting to see in the u.s. economy.
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liz: are we wasting too much time on fiscal cliff discussion and the potential effect on our money, should we not be focusing on these other issues and somehow bulletproof our investments as it pertains to each one of these concerns. we talk about doubling up. >> we should make pay more attention to europe. the attention we're paying to the fiscal cliff is not actually productive. in fact, it is leading to polarization of positions that have to be negotiated in private, and the lesson here from washington, the better i like the fiscal cliff. liz: the talks were secret today. >> might notice the financial markets are not actually very volatile in response to the special fiscal cliff. we should let it go. -@something will be resolved evn
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if it is only postponement, which i suppose sinc into the mt likely outcome. liz: talk mother three hidden risks bubbling up. we'll put the him on the facebok page. thank you, it is an honor to have you here. do you have a facebook page? >> the volatility institute. >> one of her students will help you put together. good to see you, professor. the closing bell in 16 minutes. parents released the 10 most favorite stocks for 2013. which stocks are getting a boost, and which ones even bearing could not save the date was march last year's number one pick up more than 75% in 2012, that is why you have two listen. coming up next. from the bestplayers y
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liz: goodness gracious. i was laughing away. a 32 points, hhre's your fox business market check. they came out, can't live without this. the favorite stocks of 2013. why you need to listen. western digital getting a nice lump on the news the company have a pretty decent 2012 overall. topping the list this year,
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apple not even good news like this, helping the stock today, it is down just under half a percent, looking at a move that does not help, but check of 2012 number one stock pick. shares of this company up more than 75% over the past year. it is not a bad move. have an excellent track record. molly corporation. the soaring today. nicole petallides on the floor of the nyse. nicole: this is a stock that really is jumping big-time. up over 20%. up just about 20%, a gain of $1.77. why would looking at them today? a rare earth producer. they have intense competition in this area. one of their rivals, another company now coming into some
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problems to one company's problems is another company's again. we talk about their competitors they lose their license and in australia that is not good news. what happens is molly corporation benefits from this. the other thing, talking to the traders, they were talking about the squeeze. the good news, good reason to have a stock go up. but the short squeeze, this is a stock down over 50% of this year. when you get a big pop like that, they have to cover, so they have to buy in and make up the difference. that is another factor. liz: thank you, nicole. let's get to santa with today's movers. sandra: looking at the intraday chart, we have been up about 29 points on the session. certainly somewhat of a bullish start to the week, but taking a
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look actually at the dow 30..3 one oonewere the big winners, ty reading the day today. very strong, but look at mcdonald's. one of your big leader with strong global sales numbers. just when things are to look ugly people are still hitting mcdonald's. that is one of your dow leaders today also taking a look at the fact your gainers are hewlett-packard, fiscal assistance. again, look at some of the sectors today, talk about these retail names, seems a lot of the retailers have gotten really beat up this year are getting picked up in the final days of the year. gap has been one of the biggest winners up about 70% so far this year. i don't know what is going on. when in doubt, reboot.
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the gap, there is a big change in the whole retail sector. normally i could show you, will have to reboot this thing and get back to you. liz: not a problem. not a surprise that is coming down. the dow components not hurting it read the closing bell in eight minutes. we will tell you bout one online deal company whose shares are sliding after hopes of a buyout was dashed. we're coming right back. [ le announcer ] this is amy. amy likes to invest in the market.
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liz: this is a case of you had your chance. lastly there was a rumor google might be taking a second chance to buy group on. the social media company with the coupons and deals. analysts are saying today they are throwing cold water on the rumor because into the stocks getting hurt badly down 9%. it has not been a good year down about significantly over the past year from the ipo price f 20. we see how badly it has done. about $21, not good read don't offer to take a look, but the gps company, what a move today up about under a point. part of the reason is that we'll be joining s&p 500, so lots of different money managers now buying that company. lots more ahead, the market went
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would have to gains of about 20 points. david asman getting ready for "after the bell." david: i am indeed. we don't llke to support rumors less to get some kind of confirmation on what is going on, but there's enough talk about what is happening with hewlett-packard, karel icon is interested to move the market. liz: first we have to get nicole petallides. we have been focusing on the gap because it is a held stock around. down 12% so far this month leading into the holidays you would think, nicole. nicole: that is right. despite banana republic and old navy under their umbrella, but is not a good sign with many other retailers doing so well coming up with numbers and sales that are stellar. david: hewlett-packard, carl icahn, definitely the rumors are affecting the stock, what is going on? nicole: hewlett-packard goo a
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big pop because we saw after the investor carl icahn was buying options or getting in there some way shape or form in hewlett-packard became a top performer on the dow jones industrial. liz: let's talk about other a cap tech names. this is a company that has actually found a little bit more firm footing lately. >> right. he noted they had a firmer footing these days, but also getting an upgrade didn't help because at a price target of a $24 with a buy rating helping it along. the tech did really well. but what hewlett-packard, cisco systems. an apple from negative to positive to negative really giving it a shot. david: always look about what stock really parallels the economy in general. one stock i always look at is a federal express because people are shipping things the more people shop online the more they ship things. they are expanding into


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